Fin 3070

Based on your understanding of the supply and demand dynamics of user/space markets, the new construction of units would, all else equal, cause which of the following effects? Multiple Choice decrease equilibrium rental rates and decrease property value decrease equilibrium rental rates and increase property value increase equilibrium rental rates and decrease property value increase equilibrium rental rates and increase property value

A

Which of the following is not important to the location of most commercial properties? Multiple Choice Access to customers Visibility Access to schools Availability of communications infrastructure

Access to schools

An example of a real estate asset that trades in the public debt market is a(n): Multiple Choice real property. real estate operating company. equity REIT. commercial mortgage-backed security (CMBS).

CMBS

Real estate values derive from the interaction of three different sectors in the economy. Which of the following sectors serves to allocate financial resources among households and firms requiring funds? Multiple Choice user market capital market government property market

Capital Markets

Based on your understanding of the supply and demand dynamics of user/space markets, an increase in demand for leasable space would, all else equal, cause which of the following effects? Multiple Choice decrease equilibrium rental rates and decrease property value decrease equilibrium rental rates and increase property value increase equilibrium rental rates and decrease property value increase equilibrium rental rates and increase property value

D

The expected stream of rental income is capitalized into value by converting expected future cash flows into present value through a process called: Multiple Choice amortization. discounted cash flow analysis. direct capitalization. proforma.

Discounted cash flow analysis

An example of a real estate asset that trades in the public equity market is a(n): Multiple Choice real property. home mortgage. equity REIT. commercial mortgage-backed security (CMBS).

Equity Reit

When viewed as a tangible asset, real estate can be defined as the land and its permanent improvements. Improvements on the land include: Multiple Choice fences. walkways. sewer systems. streets.

Fences

Each commercial property has unique features, whether it is its age, the building design of its structures, occupancy or its location. As such, real estate markets consist of assets that are considered: Multiple Choice homogeneous. heterogeneous. substitutes. complements.

Heterogenous

Real estate markets differ from other asset classes by having all of the following characteristics except Multiple Choice local market. high transaction costs. segmented market. homogeneous product.

Homogeneous product

Among the following four categories, which is the largest asset category in the portfolio of the average U.S. household? Multiple Choice Housing Pension assets Deposits and money market funds Government and corporate bonds

Housing

Storm water drainage systems are best described as Multiple Choice tangible assets. improvements to the land. intangible assets. improvements on the land.

Improvements to the land

The term real estate is used in three fundamental ways. When real estate is defined as a bundle of rights associated with ownership and the use of the site and improvements, it is being viewed as purely a(n): Multiple Choice tangible asset. intangible asset. parallel asset. personal asset.

Intangible asset

Which of the following would be considered a tangible asset? Multiple Choice land lease agreement mortgage listed REIT

Land

Especially in terms of retail properties, which of the following attributes is considered the most likely to result in drastic value differences between otherwise similar properties? Multiple Choice structural attributes financing attributes location attributes land attributes

Location Attributions

Real estate is property, which can be either a tangible or an intangible asset. Which of the following would be considered an intangible asset? Multiple Choice land building mortgage fence

Mortgage

Participants in the capital markets can be divided into four main categories: private equity, public equity, private debt, and public debt. Bank lending as a source of financing for the acquisition of real property occurs in the: Multiple Choice Private equity market Public equity market Private debt market Public debt market

Private Debt Market

Capital markets can be divided into four main categories: private equity, public equity, private debt, and public debt. An example of a real estate asset that trades in the private equity market is a(n): Multiple Choice real property. home mortgage. equity REIT. mortgage-backed security.

Real Property

All of the following are examples of an improvement on the land EXCEPT: Multiple Choice fences. building. walls. streets.

Streets

The term real estate is used in three fundamental ways. When real estate is defined as the land and its improvements, it is being viewed as purely a(n): Multiple Choice tangible asset. intangible asset. parallel asset. personal asset.

Tangible Assets

Real estate consists of the physical structures and infrastructure that accompany the land. All of the following are examples of an improvement to the land EXCEPT: Multiple Choice walkways. the building and parking lot. sewer system. streets.

The building and Parking lot

Competition for the currently available supply of locations and space coupled with the existing supply of leasable space, determines: Multiple Choice the current level of rental rates for each submarket and property. the riskiness of the expected cash flows of an income-producing property. the timing of the expected cash flows of an income-producing property. the cost of financing the purchase of a property.

The current level of rental rates for each submarket and property

If we desire to classify land by its use, land that consists of residential, industrial, commercial, and institutional land uses would be classified as: Multiple Choice rural land. federal land. urban land undeveloped land.

Urban land

The demand for real estate derives from the need that market participants (e.g., owner occupants, tenants, renters) have for shelter and convenient access to other locations. This competition for physical location and space occurs in the: Multiple Choice user market. capital market. government sector. property market.

User market

Real estate is defined as land and its permanent improvements. Which of the following is an example of an improvement to the land? Multiple Choice fence building water and sewer systems personal property

Water and sewer systems